Indian Central Bureau of Investigation (CBI) has recently arrested Pearls group CMD Nirmal Singh Bhangoo and three others related to the biggest financial scams ever run by a group. The group reportedly duped around 50 million Indians, several of them living in poverty, out of Australian $10 billion.
Authorities investigating have now implied that over Australian $100 million might have been diverted to Australia. The Australian Government officials, businessmen and even political parties have also come under scrutiny, as huge investments were allowed in spite of company being under review.
A company associated with Pearls donated Australian $35,000 to the Liberal National Party and Australian $3,600 to Labor Party.
An Australian cricketer Brett Lee was paid almost Australian $300,000 to promote the New Delhi-based Pearls Group.
It is stated that at least Australian $133 million of Pearls money was invested in Australia. Pearls Australasia overtook the Sheraton Mirage on the Gold Coast at a price of Australian $62.5 million, also invested in residential project in lieu with Metro property where the firm gave Australian $ 19 million.
The Metro Property group confirmed that its joint venture (JV) with Pearls Australasia was given approval by the Foreign Investment Review Board (FIRB) in 2011.
Although the company has been under scanner as back as 2002, it was banned by the Securities and Exchange Board (SEBI) India banned one Pearls company, PGF, from dealing in securities for 10 years in the year 2008. Controversy hit a few years ago when everyone was questioning the wealth amassed by the Pearls group considering it had a humble start-up by a Milk seller turned businessman.
The Indian Pearls group was introduced to Australia by Austrade in 2009.Despite the reputation Austrade assisted in the setting up of meetings with Pearls representatives during two Queensland trade missions. Though Austrade spokesman reported that no evidence has been found to claim that the staff was aware at that time Pearls Group was subject to court or regulatory orders. Pearls Australasia changed its name to MiiGroup in 2014, and says it was unaware of concerns about the Pearls Group in India. In a statement issued MiiGroup said it "will actively cooperate if the Indian authorities intend to take control of Pearl's India's shareholdings in MiiGroup".